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Salmond meets Lloyds TSB bosses 'Best result' aim for HBOS plan
(about 4 hours later)
The first minister has been meeting Lloyds TSB bosses in a bid to safeguard Scottish jobs in its proposed merger with HBOS. The Scottish Government and Lloyds TSB have pledged to work together to ensure the "best result" amid the bank's proposed takeover of HBOS.
Alex Salmond said he would present the "strong case" for maintaining jobs in Scotland during the meeting at Lloyds TSB's headquarters in London. The comments came after First Minister Alex Salmond met Lloyds TSB bosses to help ensure Scottish jobs were safeguarded if the move went ahead.
About 17,000 HBOS jobs are based in Scotland. The banking group has its headquarters at the Mound in Edinburgh.About 17,000 HBOS jobs are based in Scotland. The banking group has its headquarters at the Mound in Edinburgh.
However, fears have been raised many jobs could go if the merger proceeds. Fears have been raised many jobs could go if the takeover proceeded.
Mr Salmond told the recent SNP conference that the £37bn given to three of Britain's biggest banks, including Royal Bank of Scotland, had thrown up the question of whether this money was available to Lloyds TSB and HBOS separately. Mr Salmond told Lloyds TSB bosses in London that, if it went ahead, Scotland would be the best place to do business.
We've got to be sure that under any circumstances we get the best possible deal for Scotland Alex SalmondFirst Minister Scotland has very substantial cost advantages to do high quality financial sector business Alex SalmondFirst Minister of Scotland
The Scottish Government has written to the Treasury on the issue but has yet to receive a reply. A joint statement from the Scottish Government and the bank described the meeting as "positive and constructive".
Speaking to BBC Radio's Good Morning Scotland programme, Mr Salmond said he would be making a presentation on the case for Scotland at the meeting and arguing that, if the takeover succeeds, Scotland would be the best place for them to do business. "The Scottish Government represented the interests of its 'shareholders' - the Scottish people - by presenting its case on Scotland's three core strengths: a proven track record in financial services, the quality and talent of workforce, and the competitive advantage of Scottish location," it said.
He added: "Our priority is to protect jobs and decision making in the Scottish financial sector. "Protection of jobs, maintenance of key decision-making functions in Scotland and the emphasis on Scotland's leading position in financial services were all discussed."
"Scotland has very substantial cost advantages to do high quality financial sector business. Our presentation will include testimonials from some of the key international companies who moved here from London, and will detail the better and more effective cost ratios of 30-40% that they have established." The statement added that all those who attended agreed to "continue to work together in an open and productive manner to ensure the best results for all parties".
Mr Salmond stated again that his preference would be for HBOS to remain independent, as it had been "hard-wired" into Scottish society for decades. Earlier, Mr Salmond told BBC Scotland his priority was to protect jobs and decision-making in the financial sector.
However, he conceded that the Scottish Government had to be ready to meet any other circumstances that arose. "Scotland has very substantial cost advantages to do high quality financial sector business," he said.
He said: "If the merger is a likely outcome, if not the only possible outcome, then we've got to be sure that under any circumstances we get the best possible deal for Scotland." 'Fait accompli'
Cash injection The first minister said his preference would be for HBOS to remain independent, but conceded the Holyrood government had to be ready to meet any alternative.
The £12.2bn merger of Lloyds TSB and HBOS has met opposition in some quarters in Scotland. SNP backbencher Alex Neil has campaigned against the deal, saying it would cost thousands of Scottish jobs. The £12.2bn HBOS takeover has been opposed by some, including SNP backbencher Alex Neil, who said it would cost thousands of Scottish jobs.
The Scottish Liberal Democrats accused Mr Salmond of "throwing in the towel" and accepting the takeover of HBOS by Lloyds TSB as a fait accompli. Scottish Liberal Democrat leader Tavish Scott accused Mr Salmond of throwing in the towel and accepting the takeover as a fait accompli.
The Scottish Parliament will debate a Lib Dem motion on Thursday calling for HBOS to instead be maintained as an independent financial institution. He argued the circumstances under which the merger was agreed had now been fundamentally altered by the bailout plan to recapitalise banks.
What Alex Salmond is doing is mixing up his role as SNP leader and his role as first minister Tavish ScottScottish Lib Dem leader Scottish Labour finance spokesman Andy Kerr urged Mr Salmond to scrap plans to replace council tax with local income tax, adding: "CBI Scotland and other business organisations have said local income tax would undermine the chances of attracting corporate headquarters to Scotland."
They argue that the circumstances under which the merger was agreed have now been fundamentally altered by the government's subsequent injection of tens of millions of pounds of taxpayers' money to recapitalise banks including Lloyds TSB and HBOS.
Tavish Scott, the leader of Scottish Lib Dems, said: "I can't understand why Salmond is throwing in the towel and assuming the takeover is going to go ahead.
"He shouldn't be here talking to Lloyds TSB. He should be talking to the chancellor.
"What Alex Salmond is doing is mixing up his role as SNP leader and his role as first minister. His principle duty is to be engaging with the UK Government and saying, given the taxpayer investment in the banking sector, why should this merger go ahead?"
Labour's finance spokesman Andy Kerr said Mr Salmond should announce at the meeting that he is scrapping the Scottish Government's local income tax policy.
"CBI Scotland and other business organisations have said that the local income tax would undermine the chances of attracting corporate headquarters to Scotland and the first minister should recognise that," Mr Kerr said.